City ponders new management of FiberNet

FiberNet Monticello’s management has been in limbo since current general manager Mark Pultusker made an unexpected departure three weeks ago. In a special meeting of the City Council Monday evening Pultusker got the floor to make a case for his proposed three-year management contract to return to FiberNet Monticello. Additionally, the individuals who are assisting FiberNet on an interim basis after Pultusker left had a proposal of their own for council to consider. Each party had time to make their case before the council decides which individual(s) should be at the helm of FiberNet’s operations.

Pultusker, whose FiberConnect business is based out of Cleveland, Ohio, worked as FiberNet’s general manager since 2012, but he and the city’s negotiating team could not come to an agreement on a new contract last year. Pultusker’s proposed contract called for a few stipulations the negotiating team didn’t like, such as the condition that he could do the job from Cleveland and wanted a nearly $400,000 per year investment into FiberNet, including $9,500 per month for a billing system, $25,000 in management fees per month and $3,000 in IT consulting fees. Pultusker said he felt this was a realistic assessment of the type of investment FiberNet needed in order to become self-sufficient.

In November last year Pultusker initiated his six month exit clause to officially cease work with FiberNet Monticello by May 2014, as was required in his agreement with the city, but city administrator Jeff O’Neill said he broke that exit clause Feb. 21 when he emailed to say he would cease work with FiberNet Monticello effective that day. Pultusker said he broke the exit clause when O’Neill said he wanted to delay implementation of the upgraded FiberNet 2.0; however, O’Neill countered that email chains will show he had announced his departure before that point.

In an apparent change of heart, Pultusker lobbied for the council to approve a new contract for him to continue running FiberNet Monticello during an hour-long presentation Monday evening, where Pultusker often took a combative stance toward O’Neill’s handling of his work and explained why he feels he is the best person to run FiberNet.

Pultusker laid out 32 bullet points of his accomplishments as FiberNet’s general manager over the past 18 months, including achievements such as system upgrades, cost cutting measures, decreasing personnel costs by $280,000 by assuming those roles himself, increased customer technical support and savings to the city through various decisions he has made. Despite some disagreements, Pultusker posited that his unique education, skill set and vision make him the best person for the job.

FiberNet Monticello General Manager Mark Pultusker is hoping to convince City Council members that he deserves a new contract with the city.

During his pitch, Pultusker charged the city with being reactive rather than proactive on many different occasions and said O’Neill tried to spread misinformation about his actions. He asserted that city staff dropped the ball when it came to implementing parts of his FiberNet 2.0 plan. He also expressed disagreement over what he called an ‘ill-conceived, ill-proposed’ review of FiberNet’s operation under Pultusker, which the city spent $11,000 to conduct. Pultusker said city staff lobbied for this review as a reactive move after a Monticello Times article about the cost of his proposed contract sparked considerable response from the public. Council approved the funding for this review back in November. Mayor Clint Herbst said the review, which has not been made public, painted a positive image of Pultusker’s management and the moves he made to turn FiberNet’s operations around, but it pointed to some areas of improvement that could be made operationally, which validated council concerns that the general manager should be working locally the lion’s share of the time.

“Mark came in and did a great job,” Herbst said. “The sad thing is that if you listen to Mark, you’d think we thought he was terrible and didn’t do a good job. Bottom line is we couldn’t afford to have a guy come in for that position in the amount of money he’s asking for. It’s just crazy.”

FiberNet’s communications coordinator, Rachel Leonard, said she had a good working relationship with Pultusker but expressed some concerns.

“I personally think there are management things that could have been taken care of with somebody here,” Leonard said. “Just because there is technology available that allows someone to operate remotely doesn’t mean that every single thing happens.”

Pultusker countered that he would be hiring a manager to be there for all day-to-day issues, but Leonard said that person would report to Pultusker as his employee rather than to the city. He said this and other steps would help FiberNet to operate more like a private enterprise and increase opportunities for it to be self-sustaining. However, Leonard did not agree with this philosophy.

“This removes what is part of a municipal network and puts it in line with Mark, and I find that to be very disconcerting because this is a municipal enterprise,” Leonard added. “There’s a reason, structurally, that there is a link between city council, the general manager and the administrator.”

After hearing from Pultusker the council heard from Brian Estrem and Dan Olsen, who have stepped in to help the city on an interim basis after Pultusker left FiberNet late last month. Estrem is a partner in the Stillwater-based company U-Reka Broadband Ventures, LLC, and Dan Olson is the current general manager of WindomNet, a municipal fiber network that serves Windom, Minn. and provides support to 11 other municipalities in southern Minnesota through a joint powers agreement. Estrem and Olsen proposed a municipal alliance between FiberNet Monticello, WindomNet and Southwest Minnesota Broadband Services Group, which Olsen said was recently formed to operate a Fiber to the Home system which services customers in eight communities.

The pair gave their pitch to council on what they can offer as FiberNet’s general management, heavily stressing their strong network of local connections in the industry and the availability that gives them to save the city money through economies of scale and collaborating with other like-interested municipalities. If given the job, Estrem would serve as the general manager of FiberNet and would be working locally all the time. Olsen would function as the network architect and support tool for Monticello’s service, saying his involvement would wane less than a year into their first year after some initial goals had been achieved such as addressing network issues, training and the implementation of FiberNet 2.0.

For their services Estrem proposed compensation of $11,500 per month, or $118,000 through the end of 2014. Olsen will bill hourly at $90 per hour for on-site work and $65 per hour for all other work. He estimated just over $70,000 for the first year of work and $18,000 for 2015, an amount that would be reviewed and agreed upon monthly.

At the end of both presentations, city finance director Wayne Oberg laid out a price comparison between Pultusker’s FiberConnect and Olsen and Estrem’s municipal alliance. Over the next 36 months Oberg said the city would save $800,000 by working with the municipal alliance over FiberConnect’s proposal.

Mayor Clint Herbst said city council and staff would take time to assess the situation and would likely address the issue of FiberNet’s management at the next council meeting.

Freelancer Meghan Gutzwiller covers education and the Monticello School District.